Iran inks deal with South Korean SK Energy to modernize oil refinery

Iran, a country controlling the second largest oil refining capacity in the Middle East region after Saudi Arabia, plans to increase the export of the finished petroleum products in the near future.

The Islamic Republic inked a deal with South Korea SK Energy, which is the first ever agreement to develop and optimize Iranian oil refineries, reported Iranian Mehr News Agency on June 6.

SK Energy will carry out feasibility study for the development of Tabriz Oil Refinery in order to increase the production capacity for gasoline and diesel fuel. It also envisages promotion of desulfurization facilities.

The cost of the contract amounts to $20 million.

The implementation of the first phase of the project is anticipated to last six months, according to SK official.

Relevant talks also have been held with Japanese JX Nippon Oil & Energy (JX NOE) and Japan Cooperation Center, Petroleum (JCCP) on the issue.

Earlier in May, South Korean contractor Daewoo Engineering and Construction (Daewoo E&C) concluded a MoU with Iranian engineering firm Bahman Geno to carry out construction of an oil refinery in Bandar Jask located in the southern coast of Iran, which will have the capacity of 300,000 barrels per day.

Moreover, Iran looks for a foreign partner to develop Kish refinery by establishing a joint venture with a domestic company as well.

Iran’s current crude oil refining capacity, including gas condensate, equals almost to 1.8 to 1.85 million barrels per day.

Moreover, Iran’s Persian Gulf Star gas condensate refinery located in the south of the country will fully come on stream by the end of the next year, which will make the country self-sufficient in meeting its domestic needs for gasoline.

Iran is also interested in buying shares of existing refineries or building new ones abroad, and holds talks with Spain, Indonesia, and Brazil etc.

The removal of anti-Iran sanctions following a nuke deal signed with the world powers has helped Tehran to pursue a rapid boom in its oil industry.

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